A non-warrantable condo is a condominium project that does not meet Fannie Mae or Freddie Mac’s lending guidelines.
This can happen for several reasons — for example, if:

Too many units are investor-owned or rented out

The HOA’s financial reserves are low

There are pending lawsuits against the HOA or developer

One entity owns more than 10% of the units

The project has short-term rentals (Airbnb/VRBO) or hotel-like operations

Because of these risks, traditional lenders often can’t approve financing — but specialized Non-QM lenders can.

Common reasons include:

The HOA budget dedicates less than 10% of income to reserves

Delinquent dues exceed 15% of units

The developer still controls the HOA

More than 50% of the units are non-owner occupied

The project allows daily or weekly short-term rentals

The building has unresolved repairs or structural concerns

Each condo community is reviewed case-by-case to determine eligibility.

Down payments are typically:

10%–25% for owner-occupied or second homes

25%–30% for investment condos
The exact amount depends on the lender, credit profile, and property risk level.

Most lenders require at least a 680 credit score for non-warrantable condo financing.
Scores of 700+ generally receive better rates and lower down payment options.

Common loan structures include:

Fixed-rate or adjustable-rate (ARM) terms

Interest-only options

Bank-statement or 1099-only qualification for self-employed borrowers

Investor cash-flow (DSCR) loans for income-producing condos

These loans can be used for primary residences, second homes, or investment properties.

Yes, interest rates are typically 0.5%–1.5% higher than standard conventional loans, depending on credit, down payment, and project risk.
However, an experienced lender like myself often negotiate competitive terms once the condo’s financial health is fully reviewed.

Describe the item or answer the question so that site The lender reviews:

HOA financials and budget

Insurance coverage (master policy, flood, liability)

Owner-occupancy ratio

Number of units behind on dues

Pending litigation and special assessments
This review ensures the property is structurally and financially sound before issuing approval. who are interested get more information. You can emphasize this text with bullets, italics or bold, and add links.

Yes. You can refinance using the same Non-QM programs available for purchases.
Refinances are often used to:

Lower your rate

Access cash-out for renovations

Move from an ARM to a fixed term
If the building later becomes warrantable, you can refinance into a conventional loan.

Yes. Non-warrantable condo programs allow investment purchases as long as you meet minimum down payment and reserve requirements.
Investors often use DSCR loans (Debt Service Coverage Ratio) for rental condos, qualifying based on the property’s income potential rather than personal income.

Typical documentation includes:

Condo questionnaire completed by the HOA or management company

HOA budget and financials (last 2 years preferred)

Insurance declarations

Bylaws or CC&Rs if requested
Your lender handles this review directly with the association.

Usually 25–40 days, depending on how quickly the HOA provides required documents.
Working with a lender familiar with Texas condo financing helps keep the process smooth.

Financing available where traditional lenders decline

Flexible qualification (bank statements, assets, or DSCR)

Available for luxury, boutique, and urban condos

No PMI (private mortgage insurance)

Quick closings with minimal red tape

Slightly higher rates and down payments

Stricter review of HOA financials

Limited lender options compared to warrantable condos

Not eligible for Fannie Mae or Freddie Mac resale